War risk insurance is a type of insurance which covers damage due to acts of war, including invasion, insurrection, rebellion and hijacking. Some policies also cover damage due to weapons of mass destruction. It is most commonly used in the shipping and aviation industries. War risk insurance generally has two components: War Risk Liability, which covers people and items inside the craft and is calculated based on the indemnity amount; and War Risk Hull, which covers the craft itself and is calculated based on the value of the craft. The premium varies based on the expected stability of the countries to which the vessel will travel.
Private war risk insurance policies for aircraft were temporarily cancelled following the September 11, 2001 attacks and later reinstated with substantially lower indemnities. In the wake of this cancellation, the US federal government set up a terror insurance program to cover commercial airlines. The International Air Transport Association has argued that airlines operating in states which do not provide war risk insurance are at a competitive disadvantage in this area.
A detailed study of the Insurance of War Risks and Terrorism, including related perils such as Strikes, Riots, Civil Commotion, and Military or Usurped Power is available from the Insurance Institute of London (Research Study Group Report 258).
Famous quotes containing the words war, risk and/or insurance:
“The myth of unlimited production brings war in its train as inevitably as clouds announce a storm.”
—Albert Camus (1913–1960)
“Every day, in this mostly male world, you have to figure out, “Do I get this by charming somebody? By being strong? Or by totally allowing my aggression out?” You’ve got to risk failure. The minute you want to keep power—you’ve become subservient, somebody who does work you don’t believe in.”
—Paula Weinstein (b. 1945)
“Women hock their jewels and their husbands’ insurance policies to acquire an unaccustomed shade in hair or crêpe de chine. Why then is it that when anyone commits anything novel in the arts he should be always greeted by this same peevish howl of pain and surprise? One is led to suspect that the interest people show in these much talked of commodities, painting, music, and writing, cannot be very deep or very genuine when they so wince under an unexpected impact.”
—John Dos Passos (1896–1970)